Solara Active Pharma Sciences Ltd. - Quarterly/Annual Result Disclosures and Notes dated 31 Mar 2019

1. The above results were reviewed by the Audit Committee and approved by the Board of Directors at their meeting held on May 16,2019. The above results includes the results for the quarter ended March 31, 2019 being the balancing figure between audited figures in respect of the full financial year and the published year to date figures upto the third quarter of the current financial year. The above results for the full financial year has been audited by Deloilte Haskins & Sells LLP, the statutory auditor of the Company on which they have given an unmodified report.

2. The Board of Directors have proposed a final dividend of Rs. 5 per share, which is subject to approval by the shareholders in the Annual General Meeting.

3. The Company was incorporated on February 23, 2017 and its first financial year covered the period from February 23, 2017 to March 31, 2018. Further, the Company listed its equity shares on June 27, 2018. Accordingly, as the financial results for the quarter ended June 30, 2018 were the first time the financial results were prepared in accordance with Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulations, 2015 (the " listing Regulations"), the results for the corresponding quarter ended March 31, 2018 are not presented in these results.

4. The results for the financial year ended March 31, 2018 mainly comprised of the results of the following business that were acquired during the previous financial year and may not be comparable to the results of the year ended March 31, 2019;

(i) The Company acquired the Commodity API business and Human API business w.e.f. October 1, 2017 (the Appointed Date) under a Composite Scheme of Arrangement between the Company, Strides Pharma Science Limited (formerly Strides Shasun Limited) (Strides) and Sequent Scientific Limited (Sequent), which was approved by the NCLT.

In accordance with the terms of the Scheme, the Company allotted 24,674,267 equity shares to the shareholders of Strides and Sequent, as a consideration for the transfer of the above businesses into the Company, in the ratio of 1 equity share of Rs. 10/- each of the Company for every 6 shares of Rs. 10/- each held by the shareholders of Strides, and 1 equity share of Rs. 10/- each of the Company for every 25 shares of Rs. 2/- each held by the shareholders of Sequent, on April 11, 2018, the effect of which was given in the financial statements for the financial year ended March 31, 2018 as on the Appointed Date of the Scheme.

The transfer of the above businesses into the Company during the previous financial year were accounted in accordance with the Ind AS notified under Section 133 of the Act, as on the Appointed Date of the Scheme, as per the requirements of the Scheme.

Upon the Scheme coming into effect, the investments in following entities, held by the respective businesses above, have also been transferred to the Company:

Chemsynth Laboratories Private Limited,
India Sequent Penems Private Limited,
India Shasun USA Inc, USA

During the current financial year, the initial accounting in respect of deferred tax on brought forward losses from this business acquisition has been finalised. Pursuant to this finalisation of initial accounting, the Company has restated the balance sheet as at March 31, 2018 in accordance with Ind AS 103 'Business Combinations’, as a result of which, the deferred tax liability and goodwill as at March 31, 2018 have been reduced by Rs. 483 Lakhs pursuant to this adjustment.

Accordingly the results of the above businesses included in the previous financial year ended March 31, 2018 reflect only from period October 01, 2017 to March 31,2018.

(ii) Acquisition of R&D business from Sovizen Life Sciences Private Limited with effect from February 01, 2018.

5. Discontinued operations:

On May 19, 2018, the Board of Directors of the Company approved the disposal of business operations at Mahad facility. On July 31, 2018, the company completed the disposal of Mahad facility. The results of the discontinued operations are as under: For Table, kindly refer Corporate Announcements on www.bseindia.com.

6. Effective April 01, 2018, the Company adopted Ind AS 115 "Revenue from Contracts with Customers" using the cumulative catch-up transition method which is applied to contracts that were not completed as of April 01, 2018 (the "transition date"). The application of Ind AS 115 has resulted in decrease in retained earnings as at the transition date in respect of contracts that were not completed as at the said date by Rs. 940 Lakhs. Under the cumulative catch-up approach, the comparatives for the previous periods reported are not required to be restated and hence not comparable.

7. During the current year, the Company entered into a share purchase agreement with Strides Pharma Sciences Limited (formerly known as Strides Shasun Limited) and acquired 100% of the Investments in Strides Chemicals Private Limited for a consideration of Rs. 13,100 Lakhs with effect from September 01, 2018(acquisition date). The Board of Directors of the Company in their meeting held on September 28, 2018, have approved a Scheme of Amalgamation of Strides Chemicals Private Limited with the Company from the appointed date of September 01, 2018. The Scheme is subject to necessary regulatory approvals.

Jitesh Devendra
Managing Director